En Passant

Tony Abbott’s paid parental leave scheme is more generous than Kevin Rudd’s.

The leader of the Opposition says it will cost about $3 billion a year to pay for six months’ full replacement of wages  up to $150,000.

The Government’s scheme comes into effect on 1 January 2011 and provides the minimum wage (currently around $543) for a maximum of 18 weeks. It will cost $300 million.

Women are now almost half of the workforce, around 46 percent of all workers.

The proportion of women working has doubled since the 50s, with women’s participation rate increasing from 29 percent in 1954 to 46 percent in 1985 to 58 percent today. Men’s participation rate is 72 percent.

While most women work full-time they are more likely than men to work part-time. 38 percent of women work part-time, compared to 14 percent of men. 70 percent of the part time workforce is female.

I take these figures to mean that Labor’s parental leave scheme is a wage cut for most women workers while the Liberals’ scheme will disadvantage those part time workers earning below the minimum wage and compensate  rich workers and ruling class women disproportionately.

Nevertheless on balance women in general will be better off under Abbott’s scheme.

A women on the average wage of about $1220 per week would get $543 under Rudd’s scheme for 18 weeks but under Abbott’s scheme would get  her full wage of $1220 for 26 weeks.

Even taking into account the gender pay gap of about 17 percent between men and women for work of equal value it still means that, on average, women will be paid twice as much for two months longer under Abbott’s scheme as compared to Rudd’s.

In concrete terms a women on the average wage will be about $20,000 better off under the Opposition Leaders’ proposals. It is that which in large part explains why the Liberals scheme is ten times more costly than Labor’s.

Sharan Burrow from the Australian Council of Trade Unions has condemned the Liberals’ proposals as a smokescreen for Workchoices and an imposition on big business which will cost jobs. This is reactionary nonsense and shows how out of touch the ACTU is with the reality of the lives of working women.

Burrow and the rest of the union movement should be pushing Labor to match the Liberals on paid parental leave.

It should not be beyond the ALP to develop a paid leave scheme which benefits most working women rather than penalises them for taking maternity leave, but they won’t because it would cost money.  They had billions for pink batts but have little for working women.

Least of all will Labor tax big business to pay for a decent parental leave scheme.

Let’s look at the Liberals’ thought bubble in more detail.  They propose a 1.7 percent levy on companies with a taxable income of more than $5 million a year.  The Liberals estimate this is about 3200 companies.

It is wrong to imagine this is a tax on big business. For a start many small to medium enterprises have a taxable income over that amount.

Second, according to Jim Killaly, a Deputy Commissioner of Taxation in the Australian Tax Office:

Over the 2005 to 2008 financial years more than 40% of the company income tax returns lodged by large business taxpayers had a tax payable of zero and around half those were showing losses.

In other words 40 percent of big business won’t pay the levy.

Business groups have nevertheless gone spare, crying that civilisation as we know it is about to collapse. 

Evidently unemployment will skyrocket say the people who sacked tens of thousands and cut hours for millions of Australian workers during the global financial crisis.  Foreigners won’t invest.  Prices will go up. Profits will go down.

As Joe Hockey, the Liberal Shadow Treasurer, told Sky News on Tuesday evening, business always screams about these sorts of things but clearly has the capacity to pay. He didn’t say it was the usual bullshit from business, but that’s what he meant.

Socialists have another explanation. Business likes paid parental leave. They just don’t want to pay for it. 

It is after all business which benefits from the burden the nuclear family mainly imposes on women to raise kids. The nuclear family is a cost shifting device from capital to labour.

One of the interesting things about this is that it is the Liberals who are proposing to tax business to pay better benefits than Labor to most working women.

I wonder if the ghost of Bob Santamaria is  starting to stir in Abbott’s mind.  Abbott has described Santamaria, the family values and anti-communist warrior from the 30s onwards, as his first political mentor. 

Santamaria saw industrial capitalism as the problem of the time and viewed communism and fascism as responses to this greater evil.

He pined for a world of agrarian production - a feudal world of catholic caring and concern.

Abbott has borrowed elements of Santamaria’s family values and his Catholicism and perhaps has added something else that was the essence of the man  – his abiding contempt for industrialisation.

Of course Abbott can’t go that far since the Liberal Party worships at the altar of industry, and Abbott’s ‘actions’ on climate change show a man, like Rudd, beholden to the polluters. Nevertheless I wonder if the glimmers of Santamaria’s agrarian reaction might be shining through in Abbott’s parental leave tax on business. 

If so, then the Liberal Party as the first eleven of capital has real problems. More likely however taxing the rich will strike a chord with many workers, and using the money to fund paid parental leave will appeal to many working women and men. Abbott can package it as part of his caring, catholic communitarianism. 

Abbott will win over a number of people with this paid parental leave proposal and show up the Labor Party for the cheapskates and reactionaries they too really are.